Vietnam plans to extend stock trading hours to boost liquidity

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Vietnam's two main stock exchanges will extend trading hours to help boost liquidity and lure investors to a market that's 13 times smaller than Singapore's.

The Ho Chi Minh City Stock Exchange, the country's main bourse, will extend afternoon trading hours by 45 minutes to end at 3 p.m. local time, Chairman Tran Dac Sinh said in a telephone interview today. Trading hours for the Hanoi Stock Exchange will also be extended by 45 minutes for the afternoon session, Deputy General Director Nguyen Thi Hoang Lan said by phone.

"Longer trading hours will allow institutional and professional traders to spread out trading more," said Attila Vajda, a Ho Chi Minh City-based analyst at ACB Securities Co. "It will be slightly easier to beat the market, especially if volumes are sizable."

The VN Index (VNINDEX) has rallied 27 percent this year, the best performer among benchmark gauges in Southeast Asia, as the country's central bank cut interest rates last month for an eighth time since the start of 2012 and the government stepped up efforts to tackle banks' bad loans.

The nation's stocks are valued at $45.6 billion, compared with $595.8 billion in Singapore, the region's largest market.

The new trading hours for the Ho Chi Minh City bourse may start in the third quarter, while July 8 is targeted for the Hanoi exchange, according to the exchanges' officials. There are no changes in trading hours for the morning sessions.

The plan to extend trading hours for the Ho Chi Minh City Stock Exchange was earlier reported by Vietstock, an online financial news service.

About $51 million of securities traded daily on average this year on the Ho Chi Minh City Stock Exchange, the country's main bourse, compared with $1.34 billion for Singapore, according to data compiled by Bloomberg.

The State Securities Commission has agreed in principle to the trading hours extension, Nguyen Son, head of market development at the regulator, said today. The exchanges have started pilot programs to test the system, he said.

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